Central bankers continue to make comments regarding vigilance, but ECB President Trichet seems concerned with more than just <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Europe and the euro?
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Jean-Claude Trichet, ECB President
Global economic growth remains quite dynamic but uncertainties are also growing. We have the sentiment that the global economy grows at a robust pace. But while growth is quite dynamic uncertainties are also growing. September 11, 2006
Said that central banks cannot afford to be complacent about inflation pressure and emphasized the need to anchor inflation expectations. September 11, 2006
On the exchange rates question, I trust...that excessive volatility and disorderly movements in exchange rates are undesirable for economic growth. September 8, 2006
Axel Weber, ECB Governing Council Member
We have not decided that by the end of the year, the withdrawal of the (current) accommodative policy should be stopped. If the ECB's main scenario on economic growth and inflation is fulfilled, then there should be a progressive withdrawal of the stimulative monetary policy. If our baseline scenario is confirmed, then there is a need to take action... There would be a need to withdraw our accommodative monetary policy. This does not mean we are going to have a restrictive policy. September 6, 2006
Jurgen Stark, ECB Chief Economist
The next economic projections of the eurosystem staff will be important on discussions about the continuation of rate increases?At some moment, we will have to communicate what will happen after the end of the year. September 11, 2006
Said that there is a risk that inflation expectations may harden at a higher level should financial markets wrongly assume that the bank will tolerate an inflation rate of more than 2% permanently. September 11, 2006
Yves Mersch, ECB Governing Council Member
The ECB will exercise the strongest vigilance not only in the near future, but one should expect that the ECB won't stop its determination to control prices at the end of the year. Monetary policy will remain very accommodative due to the very abundant liquidity in the market. We will do whatever is necessary to deliver on our mandate of price stability. September 7, 2006
The Head of the Eurogroup sounds apprehensive about the ECBs candid nature?
Jean-Claude Juncker, Head of the Eurogroup
I have asked ministers not to be too outspoken on monetary policy. I am a great defender of the independence of the central bank. I will continue to press for regular informal talks with Trichet to strengthen cooperation between the euro's political and monetary arms. I wanted to take the heat out of the debate. Both of us have said there is an excellent relationship and that co-operation will be intensified. September 11, 2006
US Fed: Careful Navigation
Central bankers have made incredibly similar sounding statements, with the exception of <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Poole?
William Poole, St. Louis Federal Reserve Bank President
Noted that the Fed should have a policy that is as tight as it needs to be, though he also expects inflation to taper lower over time and sees some noise in the inflation data. He also warned that if inflation does not ebb, he would rather act sooner than later. September 11, 2006
We might have some weakness in certain sections of the country, but I think we're just not going to have a housing crash that's nationwide. September 6, 2006
Turning dovish?
Sandra Pianalto, Cleveland Federal Reserve Bank President
In reference to the August 8th FOMC meeting, Although the elevated inflation numbers concerned me, and indeed they still do, the overall pace of economic activity - especially housing activity - had begun to moderate, and the full effect of the FOMC's previous rate increases had not yet been felt. I viewed the pause as appropriate to give me the chance to accumulate more information before judging whether additional policy firming would be needed. September 8, 2006
Once a dove, always a dove?
Janet Yellen, San Francisco Federal Reserve Bank President
Commenting on the FOMC decision to hold rates, I think this was the prudent course of action that properly balances the dual mandate given to the Fed by Congress?to foster price stability and maximum sustainable employment? I would argue that a gradual approach is likely to be better because there is a need to incorporate lags between policy actions and effects on the economy. September 7, 2006
Cathy Minehan, Boston Federal Reserve Bank President
On the risks to growth, one obvious concern is the housing market?The Banks baseline forecast assumes a continued moderate downturn in residential construction?An even larger downside could result if nominal home prices actually decline, rather than flatten out as projected, affecting household wealth and overall spending more than anticipated. September 11, 2006
BoJ: Standing at a Crossroads
Officials defend their monetary and fiscal policy?
Toshihiko Fukui, BOJ Governor
The change in the base year and other changes made a bigger impact than the market had thought. But I believe the data still confirms that prices have been on a moderate uptrend since the start of this year, and suggests that the year-on-year rate of change in consumer prices is projected to continue to follow a positive trend, as the output gap continues to be positive." September 8, 2006
We always discuss currencies at the G7 meetings from various aspects as part of overall talks on future economic policy management. But this time, it is not clear what kind of opinions will be expressed in what way. But I think there is little possibility (for the G7 group) to discuss in depth on currencies in particular. I heard that there were some comments from Europeans on this issue, but I don't expect in-depth discussions on the JPY in particular. September 8, 2006
Shinzo Abe, Japanese Chief Cabinet Secretary
While we (the government and the ruling parties) are promoting reforms, I hope the BOJ will support the economy through monetary policy. September 6, 2006
Sadakazu Tanigaki, Japanese Finance Minister
Our outstanding public debt stands at around 150% of gross domestic product and we have noted the need to prevent it from snowballing. We have no time to spare when it comes to fiscal reforms. September 5, 2006
Kaoru Yosano, Japanese Economic and Fiscal Policy Minister
We've learned a lot from Mrs. Thatcher and from America, but we can't follow exactly their path to reform?There's a limit to our reforms. The market fails sometimes. September 8, 2006
PBoC: A Public Affair
Matters of the yuan have come to be a crucial issue in China, especially amidst international pressures?
Zhou Xiaochuan, PBoC Governor
I think in the second quarter of this year growth was a little too high?My opinion is that liquidity is still abundant in China's economy, so we are going to squeeze it?I think we are gradually expanding flexibility of exchange rates. That is our policy. September 11, 2006
Wen Jiabao, Chinese Premier
We will firmly deepen the yuan exchange rate formation mechanism reform and let market supply and demand set the exchange rate level and gradually allow more exchange rate flexibility. Therefore, there won't be any unexpected adjustment to the yuan exchange rate. September 6, 2006
Wu Yi, Chinese Vice Premier
China will continue to open up to attract more foreign investment. September 8, 2006
Some problems still exist in China's economy but these problems have a limited impact on the overall economy. September 7, 2006
Fan Gang, PBoC MPC member
We still need to maintain investment growth at a certain level. (Annual) investment growth of around 20% is desirable. September 7, 2006
Bo Xilai, Chinese Commerce Minister
At present, we need the developed (country) members to take the lead in making substantial concessions in order to create conditions for the quick resumption of the (WTO Doha Round) negotiations. September 5, 2006
